1. Field of the Invention
The present invention relates generally to electronic commerce and more particularly to conducting an interactive offering and bid collection over a computer network wherein bids are kept sealed until the bidding is closed.
2. Description of the Related Art
Prior to the advent of electronic auctioning over computer networks or electronic commerce, auctions were held in a group of gathered bidders with an auctioneer. As shown in FIG. 1, an auction (1) is conducted on behalf of a seller (2) by an auctioneer (4). The auctioneer receives a list of items to be sold and possibly a minimum and/or or reserve price for those items. During the auction, a plurality of bidders (6) place bids (5) under the guidance and control of the auctioneer (4). In some cases, multiple bidders (9) may pool (8) their bids, and the pooled bids (7) are submitted as a single bid with a combined quantity to the auctioneer (4).
The auctioneer enforces the rules of the auction, such as minimum bid price and quantities, minimum bid incrementing from the previous bid for a new bid, and time limits for placing bids. Auction bidders are typically qualified as to their ability to complete the purchase should their bid be the winning bid prior to entering the auction room.
Many online auctioning systems such as “priceline.com” and “mercata.com” have become very popular for individuals and businesses to use to take advantage of auctions at which they cannot be physically present. Such e-commerce auctions or online auctions are usually conducted over a specified period of time of opening and closing for bids, and are typically conducted under one of several well-known sets of rules or models. These common models include “Dutch” auctions, progressive auctions, “Yankee” auctions, single-bid auction, sealed bid auctions, reserve auctions, and hybrids of these types of auctions.
However, most sales offering and bid systems conducted by manufacturers of goods or service providers are conducted under a different set of procedures and processes. Turning to FIG. 2, a typical trader and broker system for offering and accepting bids is shown (20). In such a business-to-business (“B2B”) offering and bidding process (20), a manufacturer or service provider (21) will notify one or more traders (24) of available products or services, quantities, and minimum acceptable bid values (22). The trader then provides offerings (23′) to one or more brokers (25), to which the brokers may respond with bids (23).
In some cases, bids may be accepted for either partial lots or whole lots of offered products. These offerings (23′) and the corresponding bids (23) are collected by the trader, and the trader (24) makes a decision of which bids to accept. The traders (24) subsequently respond to the manufacturer or service provider (21) with actual orders or purchases (22).
Although the B2B offering and bid acceptance process may be conducted similarly to an auction, it is not an auction in the strict sense in that the order fulfillment, or bid acceptance, process is conducted usually by the trader at his discretion. For example, under a typical auction process, the highest qualified bidder may be defined as the bid winner. However, in a B2B offering and bid collection system, the trader may favor the second or third highest bid over the highest bid for the fact that the broker placing the second or third highest bid has preferred business arrangements, such as a longer history of purchasing from the trader or a history of larger volume purchases with the trader.
In the related application, a system and method was disclosed which allows filtered information to be used in offerings which are provided to brokers for their bids. The system and method allowed a particular trader or group of traders to filter information from larger comprehensive lists of available goods or items from a manufacturer or service provider and to produce offerings which only show the needed information for a particular broker to which to respond. This system protects the supplier of the goods from disseminating information to brokers which is irrelevant to the broker's entitlement to bid, or which might indicate a larger view or position understanding of the supplier's overall stock of an item.
Some processes of offering and collecting bids in B2B sales transactions are conducted in a single bidding process. In a single-bid process, each bidder is allowed to bid once on a particular item or commodity, unlike the auctioning process whereby each bidder is allowed to raise his previous bid to beat a current bid. Typically, a single-bid system of offering involves “sealed bids.”
Sealed bids are intended to protect the confidentiality of the single bids which are placed earlier by other bidders from being seen or disseminated to the brokers or bidders who bid later. If the bids were not sealed, and information about the earlier bids were communicated to later bidding brokers, then the later bidding brokers would be able to beat the earlier bids but just by a minimal amount. This results in two problems, the first of which is that it does not produce the highest possible bid from the winning bidder or broker. In a situation where the brokers are unsure of what the other brokers will bid, a broker is encouraged to place his highest possible bid since he only has one chance to bid. The second problem is that if the sealed bids are communicated to the later bidding brokers, the later bidding broker will have an unfair advantage to beat the bid of the earlier bidding brokers.
In traditional manual systems of sealed bids, bids are physically sealed in envelopes and are not opened until the bidding period is closed. This is intended to physically ensure that the earlier received bids are kept confidential and sealed until all bids have been received. However, in online trading systems and online auctioning systems of the current technology, most systems actually display the current highest bid. Other systems which provide for a single bid process to do not protect the electronic bid from being viewed by system administrators and internal personnel of the online bidding system operator.
Thus, there is the potential for internal personnel or system administrators to transfer or “leak” information about earlier received bids to brokers or bidders who have not yet bid. This may result, then, in a similar situation and similar disadvantages to the manual process of single sealed bids as described before.
Since electronic bids are more difficult to keep confidential and sealed, and since most users of online systems are aware of “hackers,” many customers are reluctant to employ an online bidding system and online auctioning system that does not ensure through reliable methods that the sealed bids will remain confidential until bidding is closed.
Therefore, there is a need in the art for an online offering and bid collection system which provides a secure mechanism to collect online bids, and to keep those bids secure or sealed until certain conditions have been met, such as the expiration of a bidding time window. Further, there is a need in the art for this online sealed bid system to support or to integrate easily into existing online bid systems, such as the one disclosed in the related application.
Brokers typically buy on speculation and sell to end users. Brokers may sell to multiple retailers of products or services, or they may represent a single large retailer of a product or service.
Traders are typically commissioned sales professionals, and the structure of their commissions may vary depending on the quantities and the commodities or category of products being sold.
According to industry terminology, “Reseller Master Agreements” usually govern what a broker may purchase, which are enforced by the individual traders. For example, a particular broker may only have rights to purchase given commodities or categories of products within a certain geographical zone or region as defined by his Reseller Master Agreement with the manufacturer or service provider.
Further, traders may be restricted to handling specific commodities or categories of products and also may be restricted to certain localities. For example, a trader may specialize in furniture from a particular manufacturer, and may not be authorized to handle carpets or other textiles from the same manufacturer. This trader's expertise in furniture allows him to focus his knowledge and understanding into the market place for furniture. A trader may also be restricted as to the locality or geographical region in which his brokers may purchase gods, such as Europe, North America, or even more specific such as a particular state or city.
Thus, a particular broker may receive offers from multiple traders who represent a particular manufacturer or service provider. For example, a broker that represents a chain of computer stores may receive computer memory offerings from a first trader, software upgrade offers from a second trader, and peripheral offers from yet a third trader, all of whom represent the same manufacturer. In response, this broker may bid for products or services in different categories, and must submit those bids to different traders based on the traders' commodities or categories of products that each trader handles.
As such, it is desirable not to present information to the traders or brokers which is irrelevant to the products or commodities for which they are entitled to purchase under their Reseller Master Agreement. For example, certain brokers and traders may be associated with geographical regions which are not allowed to receive certain products or services from the manufacturer because of regulatory or export controls. Additionally, certain contractual restrictions between the manufacturer and the trader or other traders and other brokers may establish territorial boundaries regarding products and services handled by the brokers and traders. Further, even though a broker may be entitled to receive offers for a particular product or service, it may not be desirable to indicate to that broker the total quantity available from the manufacturer, as having this knowledge may not encourage the broker to place his highest possible bid for the product or service.
Therefore, the available online auctioning systems are not appropriate in such B2B offering and bid collection systems. First, the available online auctioning systems represent a full auction under which certain rules dictate which bids will be automatically accepted, so the system provides offerings of available quantities, bid collection, bid rule enforcement, bid fulfillment, and bid acceptance functions under the rules of the auction. Consequently, as previously discussed, B2B offerings and bid collections are not executed under such strict rules. Further, the available online auction systems are particularly adapted to placement of orders by multiples of bidders or pooled bidders, and do not favor the traditional interaction between traders and brokers. And, most online auctioning systems provide information as to last top bid (“bid to beat”) and total quantities of goods available.
As such, the available online auction systems do not allow for the restriction and filtering of information which is conveyed from the offering party to the offered party to eliminate the presentation of information which is not relevant to the offered party's Reseller Master Agreement. This may not protect the confidentiality of total quantities available from the offering party, and may compromise the ability of the offering party to obtain the best possible bids for the goods offered.
Therefore, there is a need in the art for an online business-to-business offering and bid collection system which is suitable for offering manufactured goods and/or services to potential purchasers or brokers. There is a need in the art for this system to provide for filtering or restriction of information about the offered good to such potential purchasers or brokers such that confidentiality requirements, regulatory and territorial requirements can be met.
Additionally, there is a need in the art for this system to be robust, dependable, secure, and adaptable for use with a wide array of manufactured goods such as electronics, consumer products, clothing and textiles, other large volume purchase goods, as well as real-time traded commodities such as electric power, water, and telecommunications and data communications bandwidth.